House hunting gets mobile

Real estate agents don't want to give up control of digital house-hunting to ­Zillow, and Mobile Realty Apps gives them an alternative.

The start-up, founded in 2010 by repeat entrepreneur Aaron Kardell, now has 26 employees and just moved into new offices at the Grain Exchange Building in downtown Minneapolis, where it got its start at the CoCo co-working space.

Kardell launched the company after looking for a house in 2009 and realizing there were no good mobile apps to help with the process. The real estate app landscape has changed since then and gotten more crowded, but Kardell's company has carved out space in the market by allying itself with real estate listing services and brokerages across the country.

The firm just landed a deal with the MLS that covers most of Los Angeles, and the company is growing quickly, one of the rising stars in the local tech scene. Kardell expects the head count at the firm to double over the next 12 months, and he's in talks with investors for a second round of funding.

The company has two markets for its apps: the multiple listing services that control the data about homes in a given market, and the brokers who want to give their customers an app as an alternative to Zillow.

Mobile Realty Apps licenses its product to the MLS, which then offers the app to agents, who typically spend less than 15 hours per week at a desk.

The deal with the California Regional MLS in Los Angeles adds 73,000 agents to the pool using Mobile Realty Apps, and expands the company's coverage to over 200,000 agents. The deal came together gradually over a couple of years. The tipping point came last winter when Kardell offered a free version of the product to the CRMLS, and they came back with a more traditional proposal to pay for the service.

"It's a huge sign of validation for us," Kardell said.

Mobile Realty Apps' products are now used in 20 states and two Canadian provinces. The listing services in Minneapolis, Seattle, Milwaukee, Kansas City and others already provide the app to agents to allow them to search for properties while they are on the go.

The bigger opportunity in the market though, Kardell said, is licensing the app to such brokers as Edina Realty or Re/Max Results, which then provide their own branded app directly to customers looking to buy a home.

"That's far and away the biggest growing area of our business right now, is the service that we provide to the brokers," Kardell said. "Our brokers do see this as a solution to stay in the game and not cede an area of strategic importance to Zillow."

Mobile Realty Apps also pulls its data directly from the MLS, unlike Zillow.

"A lot of people don't realize it, but there can be significant data quality issues with Zillow and Trulia," Kardell said. "Sometimes they lack listings and sometimes they have properties listed that sold weeks ago. Since our apps pull data directly from the MLS, we always have and provide the most up-to-date picture of what properties are for sale."

Kardell said his firm also competes on user experience. For instance, its HomeSpotter augmented reality (hold up an iPad, and the viewfinder tells you which homes are for sale) is an attractive feature.

Even though tech companies in the real estate business have lately been attractive acquisition targets, Kardell said he is not looking to sell.

"Although we've got a number of early accomplishments under our belt, I feel like we've only just begun," said Kardell, who has built and sold companies like Connected Information Systems and Altona Ed.

Adam Belz • 612-673-4405 • Twitter: @adambelz